New Tool Will Help Track Food Prices

Mar 31st, 2009 1:29 PM UTC
By Beth Adler

Last week the UN Food and Agricultural Organization (FAO) unveiled a tool that will help track 800 monthly local retail and wholesale food prices for staple foods eaten in 55 developing countries. This technology – called the National Basic Food Prices Data and Analysis Tool – will enable the FAO and other agriculture and development organizations to better monitor the status of food prices on both domestic and international markets. The tool allows the FAO to compare prices in local currency or in dollars, and allows for price comparisons between domestic and international markets, between country markets, and between different markets within the same country.

Despite lower global commodity prices, recent data from the FAO confirms that food prices in Sub-Saharan Africa are still higher than a year ago. As the Financial Times reports, sub-Saharan Africa and other developing countries are still suffering the effects of high food prices, which, coupled with effects of the global financial crisis like slow economic growth and decreased remittances, threaten to exacerbate the precarious situation of hunger and poverty in the developing world. Already 963 million people in the world are hungry – an increase of 40 million from 2007 to 2008 – and the World Bank estimates that the financial crisis could push a further 53 million people into poverty this year.

Liliana Balbi, a senior economist with FAO’s Global Information and Early Warning System explains that “while food prices have fallen internationally, as indicated by the FAO food price index, this tool shows that in developing countries they have not fallen so fast, or at all.” In Kenya, wholesale maize prices were at $367 per ton, up from $222 a year ago; in Burkina Faso, the cost of sorghum, the country’s staple, had risen to 13,500 CFA francs ($27.71) per 100kg, up from 11,500 CFA francs a year ago. High food prices hit poor families hardest as they spend a much greater percentage of their household income on food compared to wealthy families.

Even though there is little respite in sight for high domestic food prices, the hope is that tools like this one will help predict food shortages before they become dire, and will be able to better target assistance to countries and regions that need it most.

-Beth Adler

TAGS: Agriculture, Policy News